.....CBN talks to business leaders in Mumbai after listing the Amaravati bonds on Bombay Stock Exchange. When the bonds were released a week ago, they were sold out in about 30 min raising 2000 crores. Now he is raising funds to build a world class city that is unrivalled in the country. Mondi has been trying hard to stall CBN's progress by not releasing funds under the AP reorganization act but he won't succeed.....

lolu. you continue showing your ignorance. when you offer interest 200 basis points above market rate with a government guarantee, it is the best deal for the investors and worst deal for the tax payers of AP. that shows the bankruptcy and desperation on CBN part, not greatness to make modi jealous.

garam-kuta wrote:lolu. you continue showing your ignorance. when you offer interest 200 basis points above market rate with a government guarantee, it is the best deal for the investors and worst deal for the tax payers of AP. that shows the bankruptcy and desperation on CBN part,not greatness to make modi jealous.

the biased telugu media would like to keep people like you ignorant by calling it a great success and all.

"Concerns

However, there have been concerns raised over this high-cost borrowing exercise. Bonds are known to have a high interest rate and for a state that is already cash-strapped, servicing the debt may become a bigger burden for a state that is already under high debt.

The interest rate at which Amaravati bonds are being issued are quite high. Greater Hyderabad Municipal Corporation (GHMC) recently issued bonds which were subscribed for an interest rate of 8.9%. Similarly, Pune Municipal Bonds were issued at an interest rate of 7.59%. However, in the case of Amaravati, the interest rate to be paid is as high as 10.32%.

garam-kuta wrote:the biased telugu media would like to keep people like you ignorant by calling it a great success and all.

"Concerns

However, there have been concerns raised over this high-cost borrowing exercise. Bonds are known to have a high interest rate and for a state that is already cash-strapped, servicing the debt may become a bigger burden for a state that is already under high debt.

The interest rate at which Amaravati bonds are being issued are quite high. Greater Hyderabad Municipal Corporation (GHMC) recently issued bonds which were subscribed for an interest rate of 8.9%. Similarly, Pune Municipal Bonds were issued at an interest rate of 7.59%. However, in the case of Amaravati, the interest rate to be paid is as high as 10.32%.

10.32% interest rate on bonds doubles their value in just 7 yrs. That's extremely high interest rate and it might require the Govt. in a few years to issue new bonds to pay the interest to investors for previous / current bonds. Or, are the current investment by Govt. through these high interest bonds lead to substantial earnings?